Obama urged to keep Atlantic drilling on the table

Industry asks administration not to back down on offshore sale

By Jennifer A. Dlouhy

March 30, 2015Updated: March 31, 2015 9:39am

WASHINGTON - Oil industry leaders on Monday urged the Obama administration not to back down from a tentatively planned auction of offshore drilling rights in the Atlantic Ocean in 2021 and to consider adding even more sales along the East Coast, despite strong opposition from some coastal communities.

The oil industry's plea was among a deluge of comments filed with the Interior Department as it weighs where to allow the next generation of offshore oil and gas development.

Interior officials will use the public comments to shape the government's schedule for selling drilling rights along the nation's coastlines from 2017 to 2022, with hopes of publishing a final plan by the end of next year. The timeline would let the Obama administration put its imprint on the legally required plan before a new president takes office. The plan is critically important to oil industry representatives hoping to plumb more offshore acreage and to environmentalists who want to end coastal drilling altogether.

"President Obama is going to own this plan," said Sierra Weaver, a senior attorney with the Southern Environmental Law Center. "It is going to be his plan for moving forward. They'll have to decide what their legacy is going to be for coastal protection."

So far, neither side is enthusiastic about the administration's initial proposal. The draft tentatively schedules 14 sales around the country, including 10 in the Gulf of Mexico, three in waters near Alaska, and one in Atlantic waters near Virginia, North Carolina, South Carolina and Georgia.

Although the Atlantic sale would be a first-in-decades opportunity, it's not enough for oil industry leaders who are eager to take a fresh look at the oil and gas resources locked along the East Coast. Drilling in other Atlantic waters, including off the coast of Canada, suggests promising geological formations could exist along the U.S. East Coast too.

"The decisions made regarding what areas are available for leasing will have long-term implications for our nation's energy security, prospects for job creation and government revenue generation," the groups said, arguing that with 10- to 15-year timelines for development, oil could start flowing from newly leased offshore tracts right as they are needed to replace declines from existing onshore and offshore reserves.

Although most of the United States' outer continental shelf is technically open for oil and gas development, that activity can only take place on leases, sold periodically through government auctions.

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And the Interior Department's draft lease sale schedule, released earlier this year, is only expected to be scaled back with time, winnowed down in response to public comments. Although the oil industry is asking for a second lease sale in the Atlantic _ before the proposed auction in 2021 _ Interior officials have made clear that once areas or sales are excluded, they will not be restored.

Nothing is legally stopping the ocean energy bureau from adding more auctions at this point, and the agency can leave the door open by doing more expansive environmental analysis of Atlantic waters, said Andy Radford, API's senior policy adviser.

Environmentalists told federal regulators that the proposed Atlantic lease sale should be called off because it opens the door to drilling and potential oil spills that could jeopardize coastal communities whose economies depend on tourism, fishing and boating, as well as the marine life that resides in nearby waters.

"Offshore oil and gas production has never taken place in the Atlantic, and this significant shift in federal policy would risk the fragile and unique ecosystems that make the region special," said dozens of East Coast groups represented by the Southern Environmental Law Center.

Separately, five conservation groups, including Oceana, the Pew Charitable Trusts and Audubon, urged the Interior Department to back off from its decision to sell new oil and gas rights in Arctic waters north of Alaska, where 1.4 million hectares are already leased.

"There is no evidence that responders would be able to effectively respond to and clean up a major oil spill in Arctic conditions," they said, and "absent significant improvements," Arctic leashing should not be considered. If leasing does go forward, they added, the government should withdraw more areas with valuable habitats that make them important to the marine ecosystem.

Oil industry leaders are worried that an already planned early 2017 auction of leases in the Beaufort Sea north of Alaska could be canceled if the proposed 2017-2022 plan is imposed earlier. The only Beaufort sale is penciled in for 2020 under the new draft.

The oil industry groups also criticize the administration's decision not to plan for a sale of oil and gas leases in the eastern Gulf of Mexico, an area barred from the activity until 2022 under a federal law.

It was unclear Monday how many comments had been filed on the plan, ahead of an 11:59 p.m. eastern deadline. Hundreds of thousands were expected, including some grassroots campaigns from environmental groups, such as the Sierra Club, and industry supporters, such as the Consumer Energy Alliance.

Consumer Energy Alliance President David Holt said the group had gathered letters from 100,000 Americans who support expanded offshore energy development.